As CDU and SPD finally begin to tackle significant reforms, CSU leader Söder consistently outlines what he will not support. Such an obstructive stance risks being far more expensive for the country than any of the proposed solutions currently under discussion.
In this increasingly complex world, at least one figure remains consistently predictable: Markus Söder. Whenever a particular political direction gains cross-party momentum, the CSU leader almost certainly intervenes, declaring, “Not like this!” Since the era of Franz Josef Strauß, rebellion against the mainstream has been a foundational principle of the CSU, shaping everything within the party, including its leadership.
As coalition partners in Berlin were still recalibrating after the Rhineland-Palatinate election and striving to uphold their post-election agreements, Söder made his presence felt from Munich. In a notable interview, he outlined a long list of unacceptable measures: higher taxes of any kind, particularly an increased top income tax rate; a higher inheritance tax; a higher statutory retirement age; and significant benefit cuts in statutory health insurance. Furthermore, he dismissed substantial tax relief as unrealistic, stating it would amount to “merely the cost of a weekly cappuccino for most taxpayers.”
Later that week, the CSU leader doubled down, rejecting the elimination of free co-insurance for spouses in health insurance, the phasing out of spousal income splitting, and any increase in value-added tax. This left both CDU and SPD in Berlin increasingly bewildered. Of all the major reform ideas emerging from the Berlin coalition, Söder endorsed only one: the abolition of the solidarity surcharge.
Söder’s statements were all the more striking given that, in the same breath, he urged all responsible parties within the Union and SPD to “think big” at last: “Everyone must emerge from their ideological ivory towers. There are no more excuses.”
Such blatant contradictions will forever remain the prerogative of CSU chairpersons.
Ideas Are on the Table
Nearly a year into their term, the CDU, CSU, and SPD ostensibly have a historic opportunity: in the coming weeks, they could engage in genuine self-assessment and restart, effectively holding a second round of coalition negotiations to deliver what the initial coalition agreement regrettably lacked: a concrete plan for change. The goal is to restore economic competitiveness and make private investments domestically more attractive. The requirements are fundamentally clear: more work incentives, relief for businesses and employees, and reduced bureaucracy (not merely announcements of less bureaucracy).
In recent weeks, initial ideas have emerged from the CDU and CSU factions on how the coalition could re-energize Germany’s economy: refinancing non-insurance related services within health insurance; ending free health insurance for spouses; a significant reduction in social security contributions; and income tax relief for middle-income earners. All these measures are debatable, yet undeniably possess the potential for substantial impact – or, as Markus Söder would put it, “It requires force.”
Driven and affected by his SPD’s poor election results, Finance Minister and Vice-Chancellor Lars Klingbeil subsequently delivered a speech that had been touted beforehand as a new “Schröder moment” for the SPD. Indeed, Klingbeil dared to break several taboos for his party, with one of the most crucial statements in his address being: “We, and by that I also mean my party, have in recent years created a system where for many people, it increasingly makes less sense to work, or barely makes sense to work more.”
To change this, Klingbeil also called for more work incentives and relief for the broad middle class, as well as longer working hours, both weekly and likely throughout one’s working life. The latter is intended to be addressed by pension reform. It was a significant speech because, with it, at least one of the two SPD chairpersons publicly acknowledged for the first time that the party had focused too much on wealth distribution and too little on wealth creation over the past 15 years.
What Does Söder Aim to Achieve?
From all these ideas, the coalition could achieve a great deal in the coming weeks. But how, when the pre-emptive “No, no, no!” echoes from Bavaria?
It is plausible that Söder merely intends to drive up the price to secure advantages for himself and his party. This pattern is well-known. It is also possible that the CSU chairman – undoubtedly the most experienced and astute among the four party leaders in this coalition – possesses the keenest sense of reality and already anticipates that little will remain of the ambitious goals. At least then he can claim he knew it all along.
However, there is a significant risk that Söder, with his lack of boldness, is already planting the seeds of failure for the upcoming second round of coalition negotiations. The crux of any major reform package extending beyond bureaucracy reduction and more flexible working hours lies in its financing: whether it’s tax relief for the middle class, refinancing non-insurance related services in statutory health insurance, a general reduction in social security contributions, or even the abolition of the solidarity surcharge that Söder desires – all of it will incur substantial costs.
Söder proposes stringent federal spending cuts, particularly in subsidies for the green transformation of the economy. While this sounds robust, his specific suggestions are unrealistic: billions allocated for the conversion of domestic steelworks to hydrogen, for example, are largely spent and irrecoverable. Furthermore, Söder’s alternatives, such as CO2 storage facilities, would also entail billions in costs that German steel producers alone would be unable to bear.
Thus, Söder’s statements evoke a disturbing escapism from someone who, despite holding an important office, seemingly wishes to remain unburdened by the realities of daily governance. A genuine reform package requires significant financial momentum, which cannot be achieved without credible counter-financing. Realistically, only a higher value-added tax remains viable, as even Klingbeil’s favored increase in the top tax rate for high earners would yield little financially and would disadvantage, rather than relieve, small and medium-sized businesses.
Indeed, there is another possible interpretation for Söder’s “what-won’t-work” strategy: it could actually be a deliberate attempt to prevent a truly impactful reform package. He naturally suspects who would next have to step out of their “ideological ivory tower” for such success: himself.
